Why You Never See A Crypto Bot That Actually Works

7 reasons why you never see a crypto bot that actually works

Crypto bots are programmed codes that help investors to automatically trade in crypto. People who trade using bots eliminate any emotions and human error likely to lead to significant losses. However, it’s challenging to come by good crypto bots because most of them are scams.

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So, why is it that you never see a crypto bot that actually works?

Let’s find out!

1. Development of a crypto bot is expensive

Building a trading bot is downright expensive and time-consuming. For starters, there are different ways of developing a crypto bot, and one of the cheapest and easiest is building on an existing open-source bot that you download and use.

A simple trading bot can be developed within weeks, but a more sophisticated one, that can work on multiple exchanges and with different currencies, could take months.

Very few crypto bot developers have the time and resources to create functional bots, which is why you rarely find bots that actually work.

2. Nobody wants to sell good crypto bot

You may have heard that trading crypto can make you a lot of money overnight. But not too fast! Most crypto bots are scams, and very few people sell genuine bots. Only mediocre or non-profitable robots are sold. The main reason is to compensate for the cost of their development, at least partially.

In fact, the easiest way for scammers is to create fake bots like Cryptosoft or 1k Daily Profit, which actually don’t work. You can inform yourself about such scams on specialized websites such as cryptodaily.no.

3. Unsustainable Core Strategy

Most developers spend time creating bots that aren’t based on sound principles. They do this by programming the bots with trading rules that show stunning results in a backtest.

Buyers will only see the results of a bot tested through curve-fitting or toxic money management techniques like martingale. Some bots are designed to have a very small profit limit and a very large loss limit. If you invest in backtested bots to lure investors, chances are that the bots will fail when used in live scenarios.

4. Unnecessary Tweaks on the Code

Most crypto bot sellers are greedy and indisciplined and will keep tweaking the bot’s code to favor them. Some buyers with coding knowledge will also change the code whenever they want the strategy to favor them.

Any unnecessary changes without a series of backtesting to confirm the efficacy of a bot could affect the trading results, rendering the bot useless.

5. Technical Errors

Crypto bots must be hosted on virtual servers to ensure they function throughout. Unfortunately, technical errors happen all the time with virtual servers, and any downtime with the hosting provider could lead to your bot not working.

Fraudsters also take advantage of the fact that most host providers don’t have enough security, such as firewalls, to protect the bots from hacking. Hackers sometimes mess with the codes, set to redirect the earnings to their wallets.

6. Lower Capacity to Handle Users

When bot developers have a bot ready, they market it heavily. Many investors, due to the fear of missing out, will want to try a new bot that gets hyped. Usually, to develop a trading bot, the experts take advantage of some existing market inefficiencies.

Now, when so many people use a specific bot, especially on one exchange, these inefficiencies may cease to exist. This makes the bot fail, and investors may lose money.

7. Failure to Specify the Assets

During backtesting, the bot gets tested on certain assets. If the seller doesn’t specify this information, it’s bound to crash if you use the bot on other assets. For instance, if backtesting were done on low-volatile assets, deploying the same bot on high-volatile assets would lead to inefficiencies.

Even if a bot seller specified the assets to trade using it, it’s never a give or take. This is because even low-volatile assets could turn highly volatile within a short period and vice versa.

Bottomline

Very few crypto trading bots are functional, and only for a short period. Developing an efficient trading bot is time-consuming and expensive. Nobody is willing to invest their resources into creating a sustainable bot. Besides, bots are prone to technical failures.